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Tony Blair has resigned from his position as the Quartet’s peace envoy to the Middle East after seven years.

The former Prime Minister has been criticised for his dual role as diplomat and businessman.

He will quit the role – which he took up immediately after leaving Downing Street in 2007 – next month.

Sources said that although Mr Blair will no longer represent the Quartet he plans to remain “active on the issues”.

Mr Blair’s business interests have become increasingly controversial.

His global consultancy offers investment and strategic advice to governments, corporations and billionaires.

Clients include PetroSaudi, an oil company with links to the ruling Saudi royal family, JP Morgan and Mubadala, an Abu Dhabi wealth fund.

Mr Blair, although he denies it, is believed to be worth between £50 million and £100 million, and his assets include several houses and a country estate.

The post for the Quartet, which represents the UN, US, EU and Russia in Middle East peace talks, has recently been been sidelined.

Chris Doyle, director of the Council for Arab-British Understanding, said: “It is long overdue that he has decided to step down.

“Somebody else needs to be given a chance with a much improved mandate than Mr Blair had when he accepted the role.

“There were perceived conflicts of interest. And increasingly senior Palestinian politicians to whom I have spoken did not have the confidence that Tony Blair was pushing the envelope to find peace or a way forward.

“Although many people might say ‘Good riddance to Tony Blair’, the overall issue is that we lack a viable, workable and effective process to end the conflict.”

Mr Blair has written to Ban Ki-Moon, the UN secretary general, to confirm his departure from the position, which is unpaid.

A source close to Mr Blair insisted he remained “fully committed” to helping to make progress on a two-state solution between Israel and the Palestinians.

However, the former premier believes an “entirely new approach” was required.

The source added that Mr Blair intended to offer the “best support … without any formal role”.

Mr Blair is also understood to feel that the Quartet post was “limited” to supporting the Palestinian people on economic development and strengthening institutions.

Although “much has been achieved”, it was “despite the political constraints”, the source said.

“He will concentrate on strengthening relations between Israel and the wider Arab world, drawing on his considerable experience and the relationships he has built in the region to advance this work.

“He believes that this could help underpin international efforts to end the ongoing impasse in the peace process,” the source said.

Earlier this year the former PM was reportedly in talks with John Kerry, the US Secretary of State, and Federica Mogherini, the EU’s foreign policy chief, over the future of his role.

Mr Blair’s office did not immediately respond to requests for a comment.

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